Designer brands Armani and Dior may be opening flagship stores on Dam square in Amsterdam as the city centre tries to increase its luxury appeal, the Parool reported on Friday.

Citing unconfirmed assurances from ‘various sources’, the paper said Dior will be renting the former ABN Amro building on Dam 2 while Armani will move into the former Rabobank offices at Dam 16.

The move is seen as a step away from in-store shops, such as those in the neighbouring Bijenkorf, marketing professor Kitty Koelemeijer told the paper.

‘These brands are no longer prepared to share space with other brands or be part of a sale because it takes away from their market value. Dior and Armani want to increase their visibility and they’re doing it in the most visible place in town,’ she told the paper.

The arrival of the designer brands on Dam square, traditionally a place where cheap and expensive shops thrived side by side, is turning it into an area for those with deep pockets only, the paper said. Shop rents of between €1,200 and €2,350 per square metre on the square are prohibitive to all but the luxury brands.

However, Armani and Dior will not be too far away from the lower echelons of fashion, as American brand TK Maxx will be moving into the former C&A building on Damrak. ‘People who shop at the big volume chains are interested in Dior as well, if only to have a look round. Consumers are opting for both luxury and affordability,’ Koelemeijer said.

The change in the centre of the capital is at first sight supportive of Amsterdam council’s attempt to encourage quality tourism, the paper writes, but may clash with making the centre more liveable for locals.

Koelemeijer is predicting ‘masses of visitors who will gawp at the luxury offerings’. ‘It will certainly not get less busy on Dam square,’ she said.